High home prices, limited supply, and weakening consumer confidence in the economy are putting pressure on the U.S. housing market, prompting the chief economist of the National Association of Realtors, Lawrence Yun, to describe the situation as a “new housing crisis.”
Sales of previously owned homes fell by 8.4% in January compared to December, reaching an annual rate of 3.91 million homes. This figure is 4.4% lower than in January 2025 and marks the lowest level since December 2023, as well as the steepest monthly decline since February 2022.
These figures are based on contracts signed in November and December, when the 30-year fixed mortgage rate had stabilized before dropping in January to 6.1%, according to Mortgage News Daily. Sales declined nationwide, particularly in the South and the West.
According to Yun, housing affordability is gradually improving as wage growth outpaces home price increases and mortgage rates ease compared to last year. However, supply remains extremely limited, restricting market activity. Buyers and renters continue to face significant challenges, leaving the market effectively “stuck” in a real crisis.
